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Business Model Shifts: Netflix's Business Model Broken Down


Have you heard? We’ve written a new book: The Invincible Company. The book builds upon Business Model Generation and Value Proposition Design. And it takes a deep dive into how world-class companies continuously reinvent their business models. In Business Model Generation we discussed business model patterns, and in The Invincible Company we are taking this one step further with Business Model Shifts and Transformations — how existing companies reinvent themselves to stay competitive in a rapidly changing world.


We have all heard that in order to avoid disruption or death, companies need to adapt and reinvent themselves. But what does this actually mean? We looked at the most successful companies and found patterns within their transformations.

Invincible companies transform by reinventing their business models and shift from an outdated one to a better one, adapted to the competitive landscape.

In our book, we discuss many examples of business model shifts (as seen in the image above). These shifts are oriented on either:

Value Proposition Shifts — Netflix transformed its reach and the entertainment industry by shifting from Low Tech (mail order DVDs) to High Tech (streaming platform).

Customer Driven Shifts — Apple redefined retail by creating the Apple Genius Bar and shifting Apple’s customer service infrastructure From Low Touch to High Touch.

Resource Driven Shifts - 23andMe shifted its genetic database as a key resource from Mono Usage (customer education) to Multi Usage (drug discovery).

Finance Driven Shifts - Adobe transformed its creative software from Transactional (single licenses) to Recurring Revenue (subscription service).

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